Cardano price to tread water soon, breaking below $2

Cardano (ADA) price has seen bulls attempting multiple times to break above $2.40. With a couple of failed attempts and the 55-day Simple Moving Average (SMA) keeping any further upside capped, ADA price is starting to get squeezed to the downside, with lower highs and lower lows. A break below $2 would see a test or break of the pivotal $1.89, deciding on the trend since May.

ADA price reaction at $1.89 to determine upcoming trend

Cardano price has been trying to recover after an almost complete reversal from its bull run throughout August. ADA price is, however, showing a bearish pattern with lower highs and lows hitting $2. A breakdown of $2 looks inevitable and could bring a heavy fought battle between bears and bulls at the pivotal level at $1.89.

ADA price has been respecting that $1.89 mark very well since May, with each time clear breaks above or below and tests that proved its support or resistance. As Cardano price nears that level, expect bulls to flee the scene and bears to await a clear break of that same level. A sort of vacuum will be formed, with neither bulls or bears daring to engage around this area.

ADA/USD daily chart

ADA price will see liquidity dry up, and a break below $1.89 would be pretty violent towards $1.67. As bears face the S1 monthly support pivot around this level, expect bulls to try and defend any further downside. Should more global forces blow more headwinds, expect a retest of the red descending trend line around $1.23. 

As global markets – certainly with the Nasdaq – have been on the front foot these past few days, expect $1.89 to defend the uptrend and see bulls flocking in to keep ADA price at or above this level. Bears will be washed out of their short positions, and Cardano price will ramp up again to test and break $2.40 to the upside. A test of $3.16 is possible if a perfect scenario is created, with stock markets and Bitcoin rallying towards new all-time highs.